Off the top of my head...
Whether or not the company would recognize an expense would depend on whether or not the amount was paid (or payable) in accordance with the individuals contract of office or employment. This contract can be formal, informal, expressed, implied, verbal, written, or whatever. However, if Larry has made an agreement with the company to work for no compensation, then the company does not have to recognize any kind of expense (or accrued liability in the case of unpaid amounts). The company has no liability, no expectation of payment and therefore, no expense.
If an amount is neither payable nor paid, then it cannot be an expense. That would be contrary to GAAP (and tax law).
Consider the example of a closely-held private corporation. The shareholder/director/manager may choose not to take any form of remuneration for his services, and accordingly, the company recognizes no liability to pay him a wage or salary. Many shareholders will make contributions of time and effort with no expectation of getting paid in order to get the business off the ground. On the other hand, others will ensure that once the company is profitable, they are paid what is due. Difference is that they decided ahead of time how they would structure the terms of their employment.
Probably won't matter to you, but I am an accredited accountant and a government tax auditor. I am also of Czech heritage :)
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